Midi Manors and More
The Canal du Midi, Photo by Norm Hartman
(FOR SUBSCRIBERS ONLY)
January 26, 2006,
Bonjour French Property Insider Subscriber,
Last weekend’s London French Property Show was very productive for Yolanda Robins and I. Although the show is targeted to a British market who doesn’t seem to know that Paris exists (!), we met a lot of valuable resources and learned more about property in France. In today’s issue, we report on our findings there.
While training to the exhibition, Yolanda and I formulated a plan for Living and Investing in France Conference attendees to be able to tour Paris apartments that were purchased and furnished within the last year by past conference participants and FPI clients, all located within walking distance of one another. We also decided that we would provide a one-hour conference call in advance of the conference during which we will discuss the pros and cons, ins and outs of investing in Paris property. And as an added bonus, offer a $50 savings on a property search to attendees. Learn more when you read today’s issue or visit http://www.adrianleeds.com/parlerparis/liveinfrance/LIF_PARIS_2006/LIF_PARIS_2006_home.html for more information or to register.
There is more and more interest in the Midi-Pyrénées area as property there is very affordable and it’s a stunningly beautiful part of France. In today’s FPI, you’ll discover an article about this relatively under-developed region.
The Chambre de Notaires brings us the third in a series of article about Buying and Selling a Home in France — all this good information should be going into your reference notebook for future use.
The Society for the Protection of Ancient Buildings (SPAB) has gotten nervous that foreign (mostly British) buyers will destroy the essential character of French properties while renovating. The SPAB is playing watchdog, rightfully so.
Today we also take another look at the CHIP program — Corporate Housing in Paris — the perfect alternative to the French Leaseback program. And very important news is from the French tax authorities about changes in tax laws for 2006.
Hot properties are listings from the Midi-Pyrénées and the hot Leaseback is on the Ile de France. So, there’s plenty to sink your teeth into and dream about, if not do something about — and maybe this is the year you’ll take the plunge and buy in France!
Editor, French Property Insider
P.S. More exciting news about the upcoming Living and Investing in France Conference here in Paris includes a special presentation over dinner Saturday, March 18, 2006 at Chez Jenny by authors of "Paris, Paris: Journey Into the City of Light," David Downie and Alison Harris. For more information, visit http://www.adrianleeds.com/parlerparis/liveinfrance/LIF_PARIS_2006/LIF_PARIS_2006_home.html
Volume IV, Issue 4, January 26, 2006
In this issue:
* Vive la France Show Report
* Buying in the Midi-Pyrénées
* Tips on Buying and Selling a Home in France
* Take Care When Restoring a French Property
* CHIP an Alternative to the Leaseback
* Knowledge is Power — Upcoming Conferences
* News on French Tax Changes
* FPI Property Consultation, Search and Relocation Solutions
* Today’s Currency Update from Moneycorp
* Next Parler Paris Après-Midi: February 14
* Hot Property Picks: Majestic Midi-Pyrénées
* Leasebacks: Residence du Lac, Paris
* Classified Advertising: Coming Soon…Parler Paris Apartments
A Taste of France in the Heart of London
By Adrian Leeds
The moment we entered the annual Vive la France French property show in London, we were once again immersed in France. The show ran Friday through Sunday at the Olympia Exhibition Hall, but Yolanda Robins and I chose to take advantage of the speedy Eurostar to spend only the first day of the show there, returning to Paris before midnight.
The first section of the weekend-long exhibition was comprised of dozens of stands of French products from wines, cheeses and sausages to Provençal soaps, table cloths and furnishings. The tourist boards of all the major regions were there handing out brochures and maps along with guide book
sellers, magazine publishers and la
All throughout the exhibition, on a stage near the entrance, were ongoing fashion shows, concerts and cooking demonstrations. In one corner was a restaurant featuring foie gras and specialties from the Southwest of France. We lunched on magret de canard and wine from Cahors.
Separated by a temporary wall along the back of the enormous exhibition space, the real French Property Show was in full swing, with dozens of stands of real estate agencies, lending institutions and property services of all kinds. This is of course, why we make the trek every year to London — to visit with many of people we already know and meet the ones we need to know, gathering material along the way.
One thing that never ceases to amaze me is the obvious lack of presence of the city of Paris. There was only one agency with any properties in Paris — all the others focused on areas of France of most interest by the British…Normandy, Brittany, Languedoc-Roussillon, Provence and the Côte d’Azur. There was not one Eiffel Tower on display, no souvenirs of Paris, no Paris tourist board.
I always ask "why?" to which I got several replies: "It’s too expensive." "If I wanted to buy property in a city, I’d buy in London." "It’s fun for a weekend, but I don’t like the Parisians (or I don’t think they like us)."
For North Americans, it’s just the opposite. With all that suburbia we have in the U.S., with our big houses and large lots, we yearn for urbanity, and Paris is just perfect — densely populated, but on a human scale and easily maneuverable. In fact, very few North Americans buy and own property in the French countryside, with the exception of Provence and Côte d’Azur and sometimes in the Loire Valley. We speak the same language (mostly), but we are definitely not the same "animals" and our viewpoint on France contrary to one another.
On the Eurostar’s fast and easy two-hour-and-forty-five-minute "trajet" between London and Paris, Yolanda and I realized that our Paris Living and Investing in France Conference attendees (March 17 – 19) would very likely want to make the most of their stay in Paris by visiting Paris apartments — both those our clients had purchased, renovated and were successfully renting and those available on the market, so we decided we had the ability to make this happen.
For all those attending, she and her French property consultation team will make a tour available on Monday afternoon after the conference of apartments purchased and furnished within the last year by other conference participants and FPI clients, all located within walking distance of one another (with the permission of the owners, of course).
We will also hold a free one-hour conference call at 8 p.m. Paris time on Sunday, February 12th for attendees only, during which we will discuss the pros and cons, ins and outs of investing in Paris property.
As an added bonus, we will offer a property search to take place following the conference at a $50 savings. The search must be booked by February 28th and the visits must take place between March 20 and April 15, 2006. Contracts and questionnaires will be provided to complete and sign before the search will begin.
If you are interested in attending the Living and Investing in France Conference here in Paris March 17 – 19, 2006 and take advantage of our property search offer, visit http://www.adrianleeds.com/parlerparis/liveinfrance/LIF_PARIS_2006/LIF_PARIS_2006_home.html
To read what past attendees have to say, visit http://www.adrianleeds.com/parlerparis/liveinfrance/conference_comments.html and to read what those who have purchased property have to say, visit http://www.adrianleeds.com/frenchproperty/insider/testimonials.html
The Midi-Pyrénées: High Altitude, Low Prices
By Nick Lloyd Jones
The Independent Online Edition
House Prices Vary According to the Local Climate in the Stunning Midi-Pyrénées
The Midi-Pyrénées in south-west France is a stunningly beautiful region that is increasingly attracting British investors. The area has plenty to recommend it, including lovely period architecture, good health and education services, a great climate, low crime rates, fabulous food and wine, superb skiing and the Mediterranean coast only a couple of hours’ drive away.
It is also relatively under-developed. Its eight departments cover a vast area – almost 46,000 sq km – yet are home to only two-and-a-half million people. As a result, life is conducted at a wonderfully relaxed p
This is traditional France where the people are warm, welcoming and friendly, leisurely two-hour lunch breaks are the norm and people don’t bother locking up their bicycles when they are out shopping.
Hardly surprising, then, that house prices in the Midi-Pyrénées are high. "You are looking at around the £200,000 mark for a basic holiday home – a two-bedroom stone cottage – and an additional £50,000 on top of that for a place you could live in full-time," advises Dan Brewer of VEF – a UK-based agency that specializes in marketing properties in the region.
However, there are significant variations in prices depending on where you buy. They tend to be highest in the central heartland around Toulouse, Montauban and Cahors – all beautiful medieval towns with thriving arts scenes and great nightlife.
They are also popular holiday destinations where many British tourists make their first acquaintance of the region and develop a liking for the local foie gras, Armagnac brandy and fine wines. It’s a trek getting there by car – about a 10-hour drive from Calais – but you can fly from Gatwick to Toulouse in 90 minutes.
Outside the region’s central area, property prices fluctuate quite a lot, according to the climate. This depends on altitude in a region where the lower-lying slopes can be basking in Mediterranean sunshine while higher southern peaks trap storm-clouds that can rage for months.
"As a rule of thumb, the higher the altitude, the lower the prices," says Nick Stallwood of the French Property Shop – another UK-based agency with a portfolio in the region. Stallwood generally advises his clients against buying properties above an altitude of 400 metres unless they can face the prospect of savage winter weather conditions.
Different regional weather patterns are reflected in architectural styles. Stoutly built properties that are beamed and well insulated with clay tend to be more prevalent in the chillier southern climes while airier Mediterranean style houses are more the norm towards the north and east where one also encounters quite a few stunning 14th and 15th century castles.
Prices to the east of the Midi-Pyrénées, in the unspoilt countryside around Aveyron, are quite a lot lower than in the region’s central heartland. This is a rural, unindustrialized stretch of country that was until recently somewhat landlocked and cut off.
Road connections have now greatly improved and the drive from Toulouse to Rodez – Aveyron’s principal town – can now be completed in under two hours. Ryanair also offers cheap direct flights from London Stansted to Rodez that take about 90 minutes.
This improved accessibility and the relatively low prices have led to Aveyron becoming an increasingly popular destination for British buyers. Typically, they are looking to buy not in Rodez itself but instead in one of the many nearby medieval hilltop villages such as Saint Antonin in the Tarn-et-Garonne about an hour’s drive to the south.
Quite a few of these villages have been colonized en masse by the British buying up local period properties. "It’s a snowball effect," says Stallwood. "Friends and family tend to start buying in the same spot and gradually local English-speaking communities start to develop."
A similar pattern is developing, too, in the more picturesque villages of the region’s central heartland such as Villefranche-de-Rouergue near to Montauban and Caussade over towards Cahors. However, one of the drawbacks of this trend has been to significantly drive up local property prices.
Those on tighter budgets might be better off house hunting in the south west of the region towards Lourdes in the foothills of the Haute Pyrénées. This is the gateway to most of the major ski resorts and is about an hour’s drive from Toulouse.
It’s a sparsely populated area of green, rolling hills and mountain meadows knee-deep in wild flowers. The climate is still relatively temperate in these parts and property prices in villages around the picturesque towns of Aurignac or Castelnau Magnoac are often up to a third lower than they are further to the north. Another alternative for those on limited budgets but wanting to buy on the lower slopes is to consider opportunities for self-building.
Land is ridiculously cheap by British standards and construction costs remain low. Also, if buying a plot of land through reputable agents, help will often be forthcoming in arranging planning permission and in dealing with the legal formalities.
For those prepared to put in the effort, buying a plot of land and starting from scratch can often work out as the most cost-effective option. For example, a four-bedroom new-build house on a prime site – inclusive of initial outlay, legal and building costs – is likely to cost as little as around £150,000.
Buying or Selling a Home
The third in a series of articles from France Notaires
Buying or Selling a Home
Purchase of Rented Property
The sale of the property free of rentals. If the seller wishes to sell the property free of rentals, he must inform the tenant that he must vacate the premises by notice given at least six months prior to the expiration of the lease. This notice i
emed to be an offer to sell to the tenant, at the indicated price. The tenant has a period of two months to inform the seller whether or not he is interested in the sale. In the absence of a reply or in the event that he waives such right, he is required to vacate the premises, at the latest at the end of the notice period. The tenant may also accept the offer to purchase the property he occupies, pursuant to his priority rights. In this case, he has two additional months (four months if he requires recourse to a loan) to sign the deed of sale at the notary’s office.
* The offer to sell under more favourable conditions. When the tenant did not accept the offer to sell, and since such notification the sale is envisaged under conditions more favourable to the purchaser, the tenant must be notified of these new terms and shall once again have a priority right to purchase
under these new terms.
* Sale to a parent. The tenant’s priority rights do not apply if the owner sells to a parent up to the third generation (great grandparent, uncle, aunt, nephew, niece, etc.), on condition that the parent occupies the property for at least two years.
The Sale of an Occupied Property
If the property to be sold is subject to rental, then it is the seller who is bound to return the security deposit to the tenant at the end of the lease. The seller may be freed of this obligation by
paying the amount of the security deposit to the purchaser, who must pay the same to the tenant upon his/her departure. In this case, the tenant must state his/her consent in the deed of sale.
The Price to be Paid
The reservation agreement will state the final purchase price of the property, indicated both in numbers and words. The amount appearing in words will be decisive in the event of a difference between the two. In order for the sale to be effective, the purchaser and seller must agree on the price.
Registration Tax or VAT
Various costs must be added to the purchase price: registration taxes (4.80% since 1999) or value added tax (VAT) if the sale is subject to such tax, which generally applies to the sale of real property in the course of construction, new buildings and for the first resale within five years after completion. Be careful! For real property in the course of construction, the price is generally stated "before tax"; however, for other transactions, the price is stated "tax included" and the seller must pay the VAT, deducting the VAT he paid on acquisition and construction realized before the sale.
Conditions for Payment of the Purchase Price
The purchaser is bound to pay the price accepted in the reservation agreement, in accordance with the terms and conditions set forth in that document. Sometimes, the price is paid within a fixed period of time or by paying a rent under a long term rental agreement (see mémo de Conseils, La vente en viager).
Financing the Purchase of a Property by Loan
Protection of the Purchaser
The law protects the purchaser who takes out a loan to purchase his home. All reservation agreements, arrangements to sell or promises to sell are deemed by law to be signed subject to the condition precedent that the loan or loans required to finance the purchase will be obtained (French consumer code, Art. 312-16). The sale is conditional on the performance of this clause or condition precedent, provided in the reservation agreement as a preventive measure. The term of validity of such a conditional sale is generally between two and three months, but may not be less than one month.
Consequences of Failure to Obtain a Loan
If in the given term for obtaining a loan, no loan is obtained, the reservation agreement will be rescinded without giving rise to any penalty or damages. All of the amounts paid in advance, such as the security deposit or a reservation indemnity, will be reimbursed to the potential buyer. However, the law does not protect a person who acts in bad faith. No protection is offered to the purchaser in the event that he does not perform what is necessary to obtain the loans in a reasonable period of time, or if he provides false information to the lender.
Terms of Purchase
Now that the status of the seller and the property have been reviewed, it must now be considered how the acquisition should be performed. Most often, this will not pose a problem. Thus, when a husband and wife, having no pre-nuptial agreement purchase a house with their savings, the property is jointly owned by them without any need to make any specific provisions therefore. For couples married under a joint estate comprising only property acquired after their marriage, this also poses no difficulty. Unless the purchase price comes from assets of the individual spouses (received by gift or will), each of the spouses has identical rights (at least in terms of value) to the property purchaser, regardless of which spouse is the purchaser on the deed of sale (see mémo de Conseils, Choose your marriage contract).
The Personal Acquisition of Property by a Spouse in a Community of Assets
If the assets used to purchase the property belong to one of the spouses, the only way that the spouse can ensure that he/she has an exclusive right to the property is to make a statement in the deed, to the effect that the funds used for the purchase belonged exclusively to him/her and that the property purchased is also personal to him/her. If the assets used to purchase the property are partially exclusive and partially collectively owned, then the property purchased cannot be exclusive unless more than half of the price is financed by cash (French Civil Code, Art. 1436).
Married Couples having Signed Pre-nuptial Agreements
The more delicate problem to resolve presents itself when the purchasers are not married in joint ownership, having signed pre-nuptial agreements, or under the regime of couples married under a joint estate comprising only property acquired after their marriage. In these cases, no rule establishes their financial relationship, except for the contribution
he joint expenses of the marriage, and that does not provide a real solution to the issue of ownership between them of a property. Generally, the spouses are purchasers in proportion to their respective financial contribution to the purchase.
Cohabitants and PACS Partners
When the purchasers live together unmarried, they purchase in the proportion of the financing made by each, for example half and half or any other proportion, such as 1/3 and 2/3 or 1/4 and 3/4. It is wise to maintain a trace of the payments made by each of them. It is common that the unmarried couple wishes to protect the surviving individual. This is often not easy to accomplish, especially due to estate tax consequences. The unmarried partners who have not entered into a civil solidarity pact (pacte civil de solidarité) are like persons not having children: gifts and testamentary dispositions are subject to a 60% tax (see memo de Conseils, Cohabitants and PACS partners).
When the unmarried couple enters into a civil solidarity pact, they are undivided owners of the assets acquired by one or the other. A clause to the contrary may nevertheless be inserted in the deed of sale.
Purchase into a joint ownership — If you purchase a lodging in a joint ownership, it is wise to review the bylaws and the shared expenses. Verify the various expenses and conditions which appear therein, in particular the joint owners’ rights and obligations regarding buildings, walls and maintenance of common areas, etc.
Other costs — The purchaser must pay other miscellaneous costs, in particular related to obtaining certain documents (cadastral map, mortgage status, etc.) plus notary’s charges (émoluments). The purchase price is also increased, as the case may be, by the real estate agent’s commission.
Sell a lodging to buy another — If you change your lodging, the best way of proceeding involves first searching for a purchaser, in order to be able to buy a new lodging. It is also possible to sign a unilateral promise of sale in view of the purchase of new accommodation, under the condition precedent of the sale of your current lodging. Such a clause is valid in accordance with a ruling of the Court of Cassation (3rd civil division, 22 November 1995, Cuvelier). It is still necessary for the seller to agree to this, and for the clause to be precise. This process should not be undertaken without a great deal of caution.
Notary’s certification — This is a certification by which the notary certifies that he is responsible for establishing the loan agreement of the purchaser or that he signed a unilateral promise or understanding to purchase and sell. The validity of such a certification is limited in time, to the limit of the duration of the reservation agreement.
Brits ‘Wrecking’ French Period Property
A heritage group is so concerned at the prospect of Brits wrecking the character of their newly purchased overseas period properties, that it has devised a course to help them get it right.
Increasing numbers of Brits are purchasing period properties, such as farm houses, barns, gites and chateaux, in countries like France and Spain.
The Society for the Protection of Ancient Buildings (SPAB) fears that in carrying out essential repairs, they are often destroying the character of the building that made it appealing in the first place.
It has therefore devised a unique one-day course exploring the issues that can arise when tackling a project on a property in France.
The course "Repairing a House in France" will cover issues including French vernacular style, what to look out for when buying, and traditional surfaces and finishes.
"The Brits are buying houses abroad cheaply and then ruining them," said Marianne Suhr, co-presenter of TV show Restoration.
"We should, of course, be repairing these beautiful old buildings responsibly but it is not just an ethical issue. If you are looking at a property, wherever it is, as a long-term investment, then it makes sense to do it properly by keeping historic features intact."
British architect Peter Ayley, who works from a studio near Toulouse, France, will outline the importance of getting the fine details right from the outset at the course.
He says the British drop their normal responsibility to buildings when they come to France.
"The major mistake people make is being seduced by the directness of simple constructions — such as a barn for example," he said.
"Clearly these buildings have no wiring, no thermal insulation — no creature comforts in fact, but making them habitable to today’s standards often destroys the quality that made them attractive in the first place."
Architect John Schofield added: "Believe me, you need to know about this if you fall for a place in France and plan to rescue its French beauty. About ten per cent of British owned properties remain delightful, the other 90 per cent show the strength of the pressure of working in a very strong and different culture."
Repairing a House in France takes place on Friday April 21st at the National Trust’s Studland Bay Education Centre in Dorset.
SPAB also runs a series of homeowners weekend repair courses. For more information see: http://www.spab.org.uk
CHIP is the best alternative to the French Leaseback that we’ve found. It maintains the assets of the Leaseback and converts the liabilities to assets for the investor who wants a hassle free investment in the city of Paris. Not sanctioned by the French Government, but offered by a private company who has developed the concept over the last five years, purchasing an apartment in Paris is now relatively hassle-free, comes with a guaranteed return on your investment and affords you an easy exit plan.
We call it "Corporate Housing in Paris — the FPI Leaseback Solution."
Corporate Housing in Paris (CHIP) comes close to matching the benefits of the Leaseback program:
1. The property you purchase via CHIP is not new construction. These are properties in particular parts of central Paris (specifically arrondissements 8, northern 16th and western 17th) in buildings of good standing that will appeal to the corporate housing market. The taxes associated with the purchase are identical to the taxes and Notaire fees associated with any resale property purchase. As with any other purchase you would make, allow for approximately 7% to 8% of the purchase price
2. Your rental income is guaranteed by CHIP, a professional run licensed rental agency that is contractually guaranteed.
3. Exactly as with a Leaseback, someone else is doing all the hard work. You do not have to appoint managing agents. You do not have to find tenants. You do not have to collect the money. You do not have to arrange for any necessary repairs.
Each property will yield a different return, however, you can expect a CHIP property to return approximately 4.5% including the expense of the Notaire fees and taxes.
There are several options. You can rent any property from the pool of apartments offered by the agency, including your own if available, at a discount of 25%. You lose nothing in your guaranteed return on investment. If you want long term usage of the property, it can be written in your contract, however, you will receive no rents during your usage, nor one month prior nor one month after and a fee of 200 euros will be imposed to cover maintenance. Your return on investment will be affected, naturally.
You are obligated to sign a three year automatically renewable lease, but with written notice, the lease can be broken with six months notice at any time. You should not incur any additional legal expense as the contracts are quite simple. You may pull out at any time and there is nothing to refund.
The property is purchased as an apartment and will remain as an apartment. You may live in it at any time, part time, full time or otherwise.
You can cancel your lease and sell your apartment or propose it to another rental agency at any time, given the six month advance notice. It is free for you to do whatever you wish with it.
There is no limit to your choice of buyers. In fact, because the property has been a successful rental property, you may have more buyers than you anticipated. You will dictate the price and therefore your capital gain.
While the Corporate Housing in Paris program is a perfect alternative to the French Leaseback, it still does not completely replace ownership of an apartment you can call your own and call home that you have total jurisdiction over its rental offerings. Those we know who do take on the added effort to own and manage the rental of their own property can gain much more than 4.5% — easily up to 10% under the right circumstances.
For more information about CHIP with a complete comparison between this program and the Leaseback program, visit http://www.adrianleeds.com/frenchproperty/consultation/sales/chip/chip.html, and/or
download this comprehensive brochure at http://www.adrianleeds.com/frenchproperty/insider/sales/chip/CHIP_brochure.pdf and/or contact Yolanda Robins at Adrian@AdrianLeeds.com
Living and Investing in France Conference
March 17 – 19, 2006
Chez Jenny, Paris
Saturday, March 18, 2006 Dinner at Historical Chez Jenny, 8 p.m.
with Guest Speakers and presentation by David Downie and Alison Harris, authors of "Paris, Paris: Journey Into the City of Light."
Take a Private Tour of the City Hall of Paris!
Monday, March 20, 2006, 10 a.m.
A special private tour of the Hôtel de Ville!
Monday, March 20, 2006, 2 p.m. – 5 p.m.
Take a Private Tour of Paris Apartments!
Sunday, February 12, 2006, 8 p.m. – 9 p.m.
Participate in a One-Hour Conference Call with FPI Consultants!
Save $50 on a Property Search and Visit Paris Apartments!
Living and Investing in France Conference
May 26 – 28, 2006
Sheraton, New Orleans
Saturday Night at the Second Oldest Restaurant in New Orleans!
May 27, 2006, 7:30 p.m.
Monday, May 29, 2006 at 1 p.m.
Tour New Orleans
with Grayline Tours
Hurricane Katrina — "America’s Worst Catastrophe"
5th Paris Poetry Workshop
May 14 – 19, 2006
This is your opportunity to spend five days in Paris as a poet among poets. Over the past four years, the Paris Poetry Workshop has become a tradition in the English-speaking Paris poetry community, offering poets from the U.S., Canada and Europe the opportunity to come together for a week of intensive workshops, lectures and readings. Anyone who’s been to Paris already knows about the inspiration and stimulation of the senses the city affords; this is a chance to see and experience a side of Paris not readily accessible to the average tourist. Participants generate new work, hone their craft, share and support one another’s creative endeavors, make new friends and expand their literary horizons. This is your chance to become part of this exciting and vibrant community. For more information visit: http://www.adrianleeds.com/parlerparis/poetry/parismay2006.html
THE ART OF TROMPE L’OEIL SEMINAR
NEW DATES: May 15 – 19, 2006
Chateau de Saint-Loup
The Art of Trompe l’Oeil Workshop originally scheduled for December 29 – January 2, has now been postponed until May 15 – 19, 2006, and will be held at the fabulous Chateau de Saint-Loup. Join a unique community of artists, engaging in hands-on painting and conversation with internationally renowned trompe l’oeil muralist and educator, Yves Lanthier. An award-winning artist, Yves has created large oil paintings and elaborate trompe l’oeil that adorn the ceilings and walls of many East Coast mansions and Palm beach estates, including Celine Dion’s estate in Jupiter, Florida.
French Tax Changes for 2006
* Income tax rates for 2006 income:
Subject to Tax
|Band||Tax Rate||Tax on Band||Cumulative Tax|
|Up to E5,515||E5,515||Nil|
|E10,847 to E24,432||E13,586||14%||E1,902||E2,195|
|E24,433 to E65,559||E41,127||30%||E12,338||E14,533|
* The individual maximum tax charge cannot exceed 60% of the taxpayer’s entire income. The taxes that are taken into consideration to determine the 60% ceiling are: personal income tax (including withholding tax), wealth tax, taxe d’habitation and taxe foncière relating to the principal home. The income to be taken into consideration is the whole income received by the taxpayer the year preceding the year of payment of the taxes excluding certain family subsidies and certain tax exempt capital gains (e.g., real estate capital gain).
* The maximum tax reduction is now capped at Euros 8,000 per household (plus Euros 750 per dependent individual);
* The 20% general allowance applicable to employment, pension and non-commercial professional income has been abolished.
* The income earned by self-employed individuals assessable under a reel BIC or BNC regime is now multiplied by 1.25 before deducting allowable expenses.
* The abatements for the Micro-BIC regimes (commercial income and furnished lettings) have reduced from 72% and 52% to 68% and 45%, depending on the nature of the activity.
* The abatement for the Micro-Fonder regime (unfurnished lettings) has reduced from 40% to 30%.
* The minimum rate of tax for non French residents with French source income has reduced from 25% to 20%.
* The 50% allowance available for dividend income has been reduced to 40%. The additional allowances available against dividend income have been increased from Euros 1,220 for a single individual and Euros 2,440 for a couple to Euros 1,525 and Euros 3,050 respectively.
CAPITAL GAINS TAX
* Jointly held properties worth Euros 30,000 or less are exempt from capital gains tax.
* Where a married couple or PACS partners own a property, each partner can benefit from the Euros 1,000 abatement.
* Wealth tax rates fo
* The 20% deduction for the main home has been increased to 30%
INHERITANCE AND GIFTS TAX
* The gifts tax exemptions (e.g. Euros 50,000 for children) are now renewed every 6 years (previously, it was every 10 years).
* There is a new allowance for inheritances and gifts received by siblings of Euros 5,000 per recipient.
* There is new allowance for gifts to nieces and nephews of Euros 5,000 per recipient.
* The tax free allowance of Euros 30,000 for cash gifts up to 31st December 2005 has not been renewed.
* The age limits applying for reductions in gifts of full ownership or in nue-propriété have been increased from 65 and 70 to 70 and 80 respectively.
* The allowance in relation to gifts of company shares has been increased from 50% to 75%, provided the requisite conditions are fulfilled.
FPI Property Consultation, Search and Relocation Solutions
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Solution #4: Property Appraisal Service
Solution #5: The "Après Vente"
Apartments for Rent: Long-Term
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TODAY’S CURRENCY UPDATE
Visit the FPI Web site and click on the link on the left panel "Click Here for Currency Convertor by Moneycorp Global Money Services" for up to the minute conversions of all major currencies.
Compare currency values easily and quickly by visiting: http://adrianleeds.com/frenchproperty/loan/moneycorpconvertor.html
Charts http://www.Moneycorp.co.uk/members/charts.asp The charts below are updated every ten seconds.
="Verdana">The prices shown are &qu
ot;inter bank" exchange rates and are not the rates that you will be offered by Moneycorp. Your rate will be determined by the amount of currency that you are buying. Please speak with an Moneycorp dealer or your consultant for a live quotation.
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Parler Paris Après-Midi
NEXT MEETING: February 14, 2006 AND EVERY SECOND TUESDAY OF THE MONTH, 3 p.m. to 5 p.m.
This is your opportunity to meet every month, often with local
professionals who can answer your Working and Living in France questions. You are invited to come for drinks and share your questions and comments about what it takes to create a life here, own property and enjoy what France has to offer. It is also an opportunity to network with other Parler Paris readers.
Upstairs at La Pierre du Marais
96, rue des Archives at the corner of rue de Bretagne, 75003 Paris
Métro Lines 9, 3 et 11, stations Temple, République or Arts et Métiers
HOT PROPERTY PICKS: Majestic Midi-Pyrénées
Each week French Property Insider features a range of properties which we believe are on the market at the time of writing. These properties are featured in order to give readers a sample of what is currently available and a working example of prices being asked in various regions of France and districts of Paris.
As we are not a real estate agency. These properties do not constitute a sales listing. For those readers seriously interested in finding property in Paris or France. you can retain our services to do the whole thing for you. For more information, visit http://www.adrianleeds.com/frenchproperty/insider/propertyconsultation.html
*** Cahors, House, 6 rooms, approx. 200m²
Beautiful house close to the center of town. Bright, with 4000m² of treed property with a garden. Veranda with barbecue, 3 garages.
Asking Price: 362,880 Euros + 2.5% Finder’s Fee
*** Tarn, Villa, 5 rooms, approx. 200m²
In the countryside, just 45 minutes from Toulouse, this lovely renovated character house is nestled in 900m² of grounds with swimming pool 12m x 6m plus outbuildings. Large living room, kitchen, bathroom, toilet, shower room 4 bedrooms.
Asking Price: 460,000 Euros + 2.5% Finder’s Fee
*** Toulouse, Villa, 12 rooms, approx. 412m²
In a quiet area, this villa has a southern exposure with land of approx. 3300 m² (about 0,82 acres) with a swimming pool. Features 12 rooms including 10 bedrooms, living room and terrace.
Asking Price: 875,200 Euros + 2.5% Finder’s Fee
LEASEBACK NEWS FROM IMOINVEST
RESIDENCE DU LAC
France, Paris / Ile de France, Epinay-sur-Seine
Studio 19m² to 24m² Euros 83,700 to Euros 103,000
One Bedroom 38m² to 39m² Euros 146,000 to Euros 165,000
GUARANTEED RENTAL INCOME UP TO: 5.00%
PRIME LOCATION AND HIGH RENTAL YIELD
Only 10 minutes from the Stade de France, 300m from the train station and 8km from Paris. Ideally placed, surrounded by the Lake of Enghien, the Seine River and the Casino of Enghien-les-Bains with its race course. Situated in the center of Epinay-sur-Seine bordering Enghien-les-Bains and close to Nanterre where many of France’s most prestigious Universities exis
t and La Defense; perfect for professi
onals looking for short or long term accommodation as well as tourists visiting this popular area.
3 level development offering 42 fully equipped modern and functional studio to 1 bed apartments. Luxury apartments with central air-conditioning, flat screen plasma televisions and digital cable. The development will be sold with an 11 year and 6 month commercial lease. This is a complete refurbishment of an existing property built in 1997; the French government will refund the VAT (value added tax) to the investor, for refurbished properties this refund varies between 11%-14%. A management company will maintain the property to very high standards throughout the period of the lease. The owner will receive a guaranteed rental yield of up to 5% that is linked to the French Cost of Construction Index, so returns will continue to increase in line with this index. The owner benefits from a 15%-20% discount off the public rate within the residence concerned.
This Leaseback investment is the perfect mix in terms of capital gains and annual rental income. Leaseback investments of this quality are very rare to come by and the units will sell out quickly. The residence is perfectly situated for a weekend getaway at the Casino of Enghien-les-Bains. In addition, the residence is within proximity to Charles de Gaulle International Airport (22km), a 10 minute walk to the Epinay train station traveling direct into Paris in under 30 minutes and metro line 13 brings you directly to Saint Lazare station linking you to major European train lines. The average capital appreciation for this region was 15% in 2004.
SEEKING A MORTGAGE IN FRANCE?
Let us help you secure a mortgage in France with interest rates as low as 3%. Visit http://www.adrianleeds.com/frenchproperty/loan for more information.
Don’t forget that with your FPI subscription you are entitled to a discount on the purchase of any Insider Paris Guides. You’ll find details of the guides at http://www.insiderparisguides.com/. When ordering, a box will pop up allowing you to enter the following:
Order more than one guide at a time and you will receive an additional discount!
THINGS YOU NEED TO KNOW
To access password protected pages: click on any of the links on the left panel of the home page of FrenchPropertyInsider.com under "Subscriber’s Only," then type in your personal username and password.
Past issues of FPI are available on the website. You will find the
"Past Issues" link on the left under "Subscribers Only" or by going to
To receive your free French Leaseback Report or the Paris Property
Report, click on
HELPFUL CONVERSIONS FOR REAL ESTATE
1 square meter = 10.7639104 square feet
1 hectare = 2.4710538 acres
For more conversions, refer to: http://www.onlineconversion.com/
Coming soon…Parler Paris Apartments rental representation at adrianleeds.com/parlerparis/apartments. If you have a property ín Paris you’d like to keep booked and represented properly, please email Adrian Leeds at Adrian@AdrianLeeds.com for more information.
For all short term rental apartments in Paris, take a look at http://www.adrianleeds.com/parlerparis/apartments or
http://www.adrianleeds.com/frenchproperty/insider/longterm.html for long term apartments.
SUBSCRIBE TO PARLER PARIS
If you’re not a regular reader of the Parler Paris daily e-letter, and would like to be, simply enter your e-mail address here (it’s free!): http://www.adrianleeds.com/parlerparis
Copyright 2006, Adrian Leeds Group, LLC